The world’s hottest AI company went through three CEOs in under a week and ended up with the same one it had at the start — so what happened, and what’s next?
On November 17th, 2023, OpenAI’s nonprofit board abruptly announced that co-founder and CEO Sam Altman was out. The shake-up came just shy of one year after the launch of ChatGPT, which quickly became one of the fastest-growing apps in history and initiated an industry-wide race to build generative AI.
Over a period of just a few days, the CEO job shuffled between CTO Mira Murati and former Twitch boss Emmett Shear. Meanwhile, hundreds of OpenAI employees said they would leave for jobs at Microsoft, OpenAI’s lead investor, unless the board reinstated Altman. In the end, Altman returned, along with co-founder Greg Brockman and a revamped board of directors.
On March 8th, after an independent investigation into his sudden firing, OpenAI reinstated Altman as a member of the board, along with three other additions.
That same month, OpenAI co-founder Elon Musk filed a lawsuit against OpenAI, claiming that the company’s pursuit of profit has led it to abandon its founding nonprofit mission to develop artificial general intelligence technology (AGI) that will benefit humanity.
All of the news and updates about OpenAI continue below.
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Microsoft and OpenAI announced Tuesday that they have adjusted their partnership so that OpenAI can access competitors’ compute.
The new agreement “includes changes to the exclusivity on new capacity, moving to a model where Microsoft has a right of first refusal (ROFR),” Microsoft says. “To further support OpenAI, Microsoft has approved OpenAI’s ability to build additional capacity, primarily for research and training of models.”
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A plan to build a system of data centers for artificial intelligence has been revealed in a White House press conference, with Masayoshi Son, Sam Altman, and Larry Ellison joining Donald Trump to announce The Stargate Project. Their companies, SoftBank, OpenAI, and Oracle (respectively), along with MGX are listed as “initial equity funders” for $500 billion in investments over the next four years, “building new AI infrastructure for OpenAI in the United States.”
According to a statement from OpenAI, “Arm, Microsoft, NVIDIA, Oracle, and OpenAI” are the initial tech partners, with a buildout “currently underway” starting in Texas as other sites across the country are evaluated. It also says that “Oracle, NVIDIA, and OpenAI will closely collaborate to build and operate this computing system.”
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OpenAI has laid out plans to become a for-profit company. In a blog post published on Friday, OpenAI’s board said it will replace the company’s existing structure with one that puts control into the hands of its for-profit arm.
Going into 2025, OpenAI plans to become a Public Benefit Corporation (PBC), which is a for-profit company meant to operate for the good of society. This division will “run and control OpenAI’s operations and business,” while OpenAI’s nonprofit will retain a stake in the business but lose its oversight role.
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“So far, the vibes are off.”We reported in October that OpenAI could launch its GPT-4 successor, codenamed Orion, this month. Now, The Wall Street Journal reports the behind-schedule model’s training is a struggle that’s racking up “enormous” costs.
When it will be ready is apparently a feel thing. WSJ writes:
It’s up to company executives to decide whether the model is smart enough to be called GPT-5 based in large part on gut feelings or, as many technologists say, “vibes.”
So far, the vibes are off.
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Meta is asking California Attorney General Rob Bonta to block OpenAI’s planned transition from a non-profit to for-profit entity.
In a letter sent to Bonta’s office this week, Meta says that OpenAI “should not be allowed to flout the law by taking and reappropriating assets it built as a charity and using them for potentially enormous private gains.”
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As winter descended on San Francisco in late 2022, OpenAI quietly pushed a new service dubbed ChatGPT live with a blog post and a single tweet from CEO Sam Altman. The team labeled it a “low-key research preview” — they had good reason to set expectations low.
“It couldn’t even do arithmetic,” Liam Fedus, OpenAI’s head of post-training says. It was also prone to hallucinating or making things up, adds Christina Kim, a researcher on the mid-training team.
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Nearly two years ago, OpenAI said that artificial general intelligence, or AGI — the thing the company was created to build — could “elevate humanity” and “give everyone incredible new capabilities.”
Now, OpenAI CEO Sam Altman is trying to lower expectations.
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As OpenAI was ironing out a new deal with Microsoft in 2016 — one that would nab the young startup critical compute to build what would become ChatGPT — Sam Altman needed the blessing of his biggest investor, Elon Musk.
“$60MM of compute for $10MM, and input from us on what they deploy in the cloud,” Altman messaged Musk in September 2016, according to newly revealed emails. Microsoft wanted OpenAI to provide feedback on and promote (in tech circles, “evangelize”) Microsoft AI tools like Azure Batch. Musk hated the idea, saying it made him “feel nauseous.”
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Microsoft is getting ready to host OpenAI’s next model, just as reports emerge describing unprecedented tension in their complex relationship.
We just exclusively revealed that Orion, OpenAI’s next model, is set to be released by the end of the year. A source familiar with Microsoft’s AI plans tell me that engineers inside the company have been preparing to host OpenAI’s Orion model in recent weeks.
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OpenAI plans to launch Orion, its next frontier model, by December, The Verge has learned.
Unlike the release of OpenAI’s last two models, GPT-4o and o1, Orion won’t initially be released widely through ChatGPT. Instead, OpenAI is planning to grant access first to companies it works closely with in order for them to build their own products and features, according to a source familiar with the plan.
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Miles Brundage, OpenAI’s senior adviser for the readiness of AGI (aka human-level artificial intelligence), delivered a stark warning as he announced his departure on Wednesday: no one is prepared for artificial general intelligence, including OpenAI itself.
“Neither OpenAI nor any other frontier lab is ready [for AGI], and the world is also not ready,” wrote Brundage, who spent six years helping to shape the company’s AI safety initiatives. “To be clear, I don’t think this is a controversial statement among OpenAI’s leadership, and notably, that’s a different question from whether the company and the world are on track to be ready at the relevant time.”
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Former OpenAI CTO Mira Murati’s next move: another AI startup.
Murati is seeking venture capital funds for a new AI startup with its own proprietary models, Reuters reported Friday.
Barret Zoph, an OpenAI researcher who left the same day as Murati may join the venture, according to unnamed sources cited by the outlet.
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Here’s the thing about asking investors for money: they want to see returns.
OpenAI launched with a famously altruistic mission: to help humanity by developing artificial general intelligence. But along the way, it became one of the best-funded companies in Silicon Valley. Now, the tension between those two facts is coming to a head.
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OpenAI CTO Mira Murati is leaving the company.
“I’m stepping away because I want to create the time and space to do my own exploration,” she wrote in a post on X. “For now, my primary focus is doing everything in my power to ensure a smooth transition, maintaining the momentum we’ve built.”
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Jony Ive has confirmed that he’s working with OpenAI CEO Sam Altman on an AI hardware project. The confirmation came today as part of a profile of Ive in The New York Times, nearly a year after the possibility of a collaboration between Altman and the longtime Apple designer was first reported on.
There aren’t a lot of details on the project. Ive reportedly met Altman through Brian Chesky, the CEO of Airbnb, and the venture is being funded by Ive and the Emerson Collective, Laurene Powell Jobs’ company. The Times reports it could raise $1 billion in funding by the end of the year but makes no mention of Masayoshi Son, the SoftBank CEO rumored last year to have invested $1 billion in the project.
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Step four: Profit.
CEO Sam Altman told employees in a company-wide meeting that OpenAI’s complicated corporate structure as a for-profit endeavor under the umbrella of a non-profit is set to change, “likely sometime next year,” reports Fortune.
The reconfiguring, which has been rumored before, would reportedly shift the company “away from being controlled by a non-profit.” OpenAI told the outlet that the “non-profit is core to our mission and will continue to exist.”
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The huge leaps in OpenAI’s GPT model probably came from sucking down the entire written web. That includes entire archives of major publishers such as Axel Springer, Condé Nast, and The Associated Press — without their permission. But for some reason, OpenAI has announced deals with many of these conglomerates anyway.
At first glance, this doesn’t entirely make sense. Why would OpenAI pay for something it already had? And why would publishers, some of whom are lawsuit-style angry about their work being stolen, agree?
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Another OpenAI co-founder departs.
John Schulman is leaving to work on alignment at Anthropic, OpenAI’s chief rival. In a reply post on X, CEO Sam Altman thanked Schulman and said he “laid out a significant fraction of what became OpenAI’s initial strategy.”
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Elon Musk has revived his complaint against OpenAI after dropping a previous lawsuit, again alleging that the ChatGPT maker and two of its founders — Sam Altman and Greg Brockman — breached the company’s founding mission to develop artificial intelligence technology to benefit humanity.
The new lawsuit filed in federal court in Northern California on Monday says that Altman and Brockman “assiduously manipulated Musk into co-founding their spurious non-profit venture” by promising that OpenAI would be safer and more transparent than profit-driven alternatives. The suit claims that assurances about OpenAI’s nonprofit structure were “the hook for Altman’s long con.”
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Microsoft now lists OpenAI as a competitor.
CNBC spotted the update this week in Microsoft’s risk factors with the SEC. These are managed by lawyers to help shield companies from shareholders lawsuits and generally pretty conservative. Still, the change feels like a sign of how OpenAI and its largest investor are drifting apart.
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Microsoft has dropped its seat as an observer on the board of OpenAI, less than eight months after securing the non-voting seat. Apple was reportedly planning to join OpenAI’s nonprofit board, but now the Financial Times reports that Apple will no longer join the board.
OpenAI confirmed that Microsoft has given up its seat in a statement to The Verge, following reports from Axios and the Financial Times that Microsoft’s deputy general counsel Keith Dolliver wrote a letter to OpenAI late on Tuesday.
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Apple has chosen App Store chief and former marketing head Phil Schiller to represent the company on OpenAI’s nonprofit board, according to a report from Bloomberg. Schiller will reportedly get an observer role, meaning he can attend board meetings but can’t vote or act as a director.
Joining the board will allow Schiller to learn more about the inner workings of OpenAI as Apple works to build ChatGPT into iOS and macOS later this year. The integration will allow the AI-supercharged Siri to punt more advanced queries to ChatGPT if users grant permission. As previously reported by Bloomberg, no money is currently involved in the partnership, though Apple is expected to get a percentage of ChatGPT subscriptions made through its platforms down the road.
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OpenAI’s business is booming.
The company is on track to make about $3.4 billion in revenue this year, which is about double what it brought in last year, according to a new report by The Information.
CEO Sam Altman reportedly told employees that $200 million of that revenue is the cut OpenAI gets from Microsoft selling its models through Azure. That means the vast majority of OpenAI’s revenue is coming from ChatGPT subscriptions and its own developer platform.